Credit unions pull back AGMs
Jamaica’s 25 credit unions will not host annual general meetings (AGMs) during the early stages of the coronavirus crisis, for which they would have needed permission from Registrar of Co-operatives Errol Gallimore.
The registrar has taken a decision that no meetings will be approved for dates up to June, a mandate that the umbrella representative of the community banks, the Jamaica Co-operative Credit Union League (JCCUL), has said it supports.
“The registrar, in his wisdom – and we concur – said that he would not be granting permission for any AGMs, and those already granted will be rescinded,” JCCUL General Manager Robin Levy told the Financial Gleaner.
“We all have to do our part. The prime minister has asked to avoid large gatherings, and we are acceding to that request,” he added.
Annual meetings are usual major events for co-operative bodies, which are member-based, as the main conduit through which they receive comprehensive information on the financial position of their organisation as well as its plans and programmes. Such meetings are also calendar events for shareholders of listed companies and are required to be held under company law and stock market rules.
Last week, as Jamaica ramped up social distancing as a virus-containment strategy, the Jamaica Stock Exchange advised listed companies that while AGMs were required, there was room for their postponement and that such options should be considered.
Four listed companies took that advice last week – Cargo Handlers Limited, Jamaican Teas Limited, QWI Investments Limited, and Main Event Entertainment Group Limited – and more may follow this week.
AGMs for Jamaica’s 25 credit unions, which serve about a million members across 110 branches nationwide, are a vital part of their policymaking and leadership-selection processes.
The voluntary board of directors and the key committees such as those dealing with credit and supervisory issues relating to governance and operations are named in that forum.
The existence and make-up of the committees have often been cited as unique features of the credit union movement and one of the reasons they do not fold during financial crises.
Recognising the importance of the AGMs, Levy said that the JCCUL began looking at workarounds but found no viable options.
“We considered methods such as allowing remote access, but there were administrative challenges such as ID verification and the inability of every single credit union member having access,” said Levy. The latter was an important consideration “since every member has the same power regardless of amount invested”, he said.
“We also considered the fact that regardless of the size of the meeting, there would be some exposure since the directors, staff members JCCUL support, and regulators would have to be present,” he said.
The JCCUL’s own AGM, which was scheduled for May 23, has also been postponed, in addition to that of the Palisadoes and First Regional credit unions, which were slated for March 31.
The credit union movement manages assets of $123.97 billion, inclusive of loans of $90.99 billion. The more than one million members currently have savings of $96.31 billion under management.
The JCCUL acts as the umbrella organisation, serving in an advocacy role, managing treasury through the Credit Union Fund Management Company, and managing switching operations for the movement’s Access Plus cards.
The league once operated as the de facto overseer of the movement, but credit union regulation is being transitioned to the central bank after years of negotiation and reforms.
Levy says that with the COVID-19 outbreak, the league has scaled back operations to 50 per cent of its 82 staff.
“Our approach is to look at the mission-critical aspects of our operation and ask that those staff come in for those areas and the others work from home,” he said.
The JCCUL has also looked at staggered hours and compressed workweeks, according to Levy. He says this is line with the organisation’s disaster recovery plan, which has been modified and applied to the 25 credit unions.
“Most of the credit unions are still fully functional but have closed some branches, and in all of this, they are encouraging members to use online services,” Levy said.